Industrial revolution changed all


Wed,March 6, 2019 01:18 AM

CHAPTER 1 WORLD AND INDIAN ECONOMIC HISTORY Part 2
Today lets discuss the occurrence, importance and consequences of the Industrial revolution, that occurred about two centuries ago. This is in continuation with the article published on 20th, February 2019, in these columns.

Industrial Revolution:

Industrial Revolution, the process of change from an agrarian and handicraft economy to one dominated by industry and machine manufacturing. This process began in Britain in the 18th century and from there spread to other parts of the world. The main features involved in the Industrial Revolution were technological, socioeconomic, and cultural.

The technological changes included the following:

1) the use of new basic materials, chiefly iron and steel,
2) the use of new energy sources, including both fuels and motive power, such as coal, the steam engine, electricity, petroleum, and the internal-combustion engine,
3) the invention of new machines, such as the spinning jenny and the power loom that permitted increased production with a smaller expenditure of human energy,
4) a new organization of work known as the factory system, which entailed increased division of labour and specialization of function,
5) Important developments in transportation and communication, including the steam locomotive, steamship, automobile, airplane, telegraph, and radio, and
6) the increasing application of science to industry. These technological changes made possible a tremendously increased use of natural resources and the mass production of manufactured goods.

In the thousands of years before the Industrial Revolution, civilization was stuck in the Malthusian Trap. Without machines or technological innovations, one person could only produce so much with their time and resources. The industrial revolution changed all that. One way to understand the graph below, is that everything to the left of 1800 is an approximation of population distribution around the world and everything to the right of 1800 is a demonstration of productivity divergences around the world, i.e. specialization in different sectors with massive production started. Economies across the world started to master different means of manufacturing, production and supply chains by steam, electricity, and ultimately software. This specialization and mastering first concentrated, in the West, and then spread to Japan, Russia, China, India, Brazil, and beyond.

Why did the industrial revolution begin in Britain

A number of factors contributed to Britains role as the birthplace of the Industrial Revolution. For one, it had great deposits of coal and iron ore, which proved essential for industrialization. Additionally, Britain was a politically stable society, as well as the worlds leading colonial power, which meant its colonies could serve as a source for raw materials, as well as a marketplace for manufactured goods.

As demand for British goods increased, merchants needed more cost-effective methods of production, which led to the rise of mechanization and the factory system.

The textile industry, in particular, was transformed by industrialization. Before mechanization and factories, textiles were made mainly in peoples homes (giving rise to the term cottage industry), with merchants often providing the raw materials and basic equipment, and then picking up the finished product. Workers set their own schedules under this system, which proved difficult for merchants to regulate and resulted in numerous inefficiencies.

In the 1700s, a series of innovations led to ever-increasing productivity, while requiring less human energy. For example, around 1764, Englishman James Hargreaves (1722-1778) invented the spinning jenny (jenny was an early abbreviation of the word engine), a machine that enabled an individual to produce multiple spools of threads simultaneously.


GDP

One challenge of using cotton, however, was that the British did not grow any cotton plants because of their cold climate. So, they revved up trade with cotton producers far across the world, such as India and the Southern United States.

There were also many new developments in nonindustrial spheres, including the following:

economic changes that resulted in a wider distribution of wealth, the decline of land as a source of wealth in the face of rising industrial production, and increased international trade, political changes reflecting the shift in economic power, as well as new state policies corresponding to the needs of an industrialized society, social changes, including the growth of cities, the development of working-class movements, and the emergence of new patterns of authority, and cultural transformations of a broad order. Workers acquired new and distinctive skills, and their relation to their tasks shifted; instead of being craftsmen working with hand tools, they became machine operators, subject to factory discipline.

Psychological change:

Confidence in the ability to use resources and to master nature was heightened.Though Industrial Revolution began in Great Britain and quickly spread throughout the world, the American Industrial Revolution, commonly referred to as the second Industrial Revolution, started sometime between 1820 and 1870. Although the Industrial Revolution occurred approximately 200 years ago, it is a period in time that left a profound impact on how people lived and the way businesses operated. Arguably, factory systems developed during the Industrial Revolution are responsible for the creation of capitalism and the modern cities of today. Several major pitfalls developed as the Industrial Revolution progressed. There was a reduction in agriculture as people were abandoning their farms to work in city factories where they could earn a higher income.

This led to a shortage a food produced on farms. Increased pollution was a pitfall of the Industrial Revolution. Before the sharp increase in factory numbers, there was a limited amount of pollution generated in the world as production was predominantly manual. The Industrial Revolution provided an incentive to increase profits, and as a result, working conditions in factories deteriorated. Long hours, inadequate remuneration and minimal breaks became the norm. This subsequently led to health issues for many factory workers. Labor movements in the United States developed momentum from the late 19th century in response to poor working conditions that developed during the Industrial Revolution.

Shift in the Wealth of World:

The economic wealth of the world which was mainly concentrated in India and China for thousands of years began to get concentrated in the European countries with the beginning of the 18th century due to industrial revolution and technological innovations. As a result, agrarian economies in the west started to turn into manufacturing economies. This is another major transition in the economic history of the world.

The two world wars in the 20th century once again changed the whole economic face of the world. The economic concentration of the wealth which has been concentrated in the European counties since the 18th century started to slowly shift towards the USA. The world wars saw to it that most of the weapons required for these wars were brought from the USA and as a consequence, the wealth of the European countries started shifting to the USA.

The USA, also called the land of opportunities, revolutionized technology and capitalism in such a way that has never been seen before. Since the middle of 20th century, there has been an exponential rise in the GDP of USA, making it the most powerful economy in the world today, essentially propelled by the Services sector.The services sector has been the driver of the world GDP for the last 6 decades. Information technology backed with Internet, communications, banking, tourism, infrastructure, insurance etc have been the key sectors. What is also interesting to note here is that, since 2000, China has emerged as the manufacturing hub and India as the back office( services provider)of the world.

The Malthusian Trap is the theory that, as population growth is ahead of agricultural growth, there must be a stage at which the food supply is inadequate for feeding the population. This was originally devised by Robert Malthus in An Essay on the Principle of Population in 1798, arguing that food supply expansion is linear whereas human growth is exponential.The Malthusian trap or population trap is a condition whereby excess population would stop growing due to shortage of food supply leading to starvation. He suggested that while technological advances could increase a societys supply of resources, such as food, and thereby improve the standard of living, the resource abundance would enable population growth, which would eventually bring the per capita supply of resources back to its original level. Some economists contend that since the industrial revolution, mankind has broken out of the trap.

Vijay Ch
Amulya B
Civil Services Faculty,
M.Sc Finance( Gold Medalist)
For any queries, contact : [email protected]

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